US, EU close to sealing data-sharing deal

Snowden leaks forced renegotiation.

The European Commission is working with the United States on the final details of a commercial data-sharing deal that was put up for renegotiation following leaks two years ago that exposed US mass surveillance practices.

The European Commission has been negotiating with the United States since January 2014 to reform an existing agreement allowing companies to transfer data easily between the two areas, known as "Safe Harbour".

The data-sharing deal originally dates from 2000, but the Commission called for a review in 2013 after former National Security Agency contractor Edward Snowden leaked details about US spying practices targeting European citizens and some heads of state.

Brussels has demanded guarantees from the United States that the collection of EU citizens' data for national security purposes would be limited to what is necessary and proportionate.

It has made this a condition for not scrapping Safe Harbour legal protection, which facilitates the everyday business activities of some 4000 companies, both European and American.

Under the new deal, US registered companies will face stricter rules when transferring data to third parties.

This is because Brussels had concerns that companies could circumvent the EU's tough data protection regime by passing data on to another company not certified under the data-sharing deal and therefore not adhering to the same privacy standards.

Negotiations on the new data-sharing deal have taken some time because the EU has wanted to ensure the US guarantees are watertight.

But now elements have been worked out that could be a basis for finalising an agreement after the summer, according to a document seen by Reuters.

The new deal would allow both sides to monitor the functioning of Safe Harbour, including how the limitations on US authorities' access to the data are being applied.

Reforms enacted by the US government since the Snowden revelations could help the two sides to reach an agreement.

US President Barack Obama in June signed a bill reforming a government surveillance program that swept up millions of US telephone records. He has also said that he plans to extend certain protections enjoyed by US citizens to foreigners.

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